Are You Covered? Closing the Gaps within Fitness Insurance

You’ve just purchased insurance for your gym. You trust your insurance agent and have no issues signing on the dotted line without reading all the fine print (there is a lot of it…). Great!

Time passes and everything is going well. Business is booming, you’ve made all your monthly payments on-time, renewed with no lapses in coverage for several years now. WHAM! Jessica was just doing pull-ups, fell off the bar, and broke her arm…

Your insurance agent puts you in touch with your carrier’s claims department. During that call, you’re told that you have an Athletic Participant Exclusion in your Liability policy. Okay… well what does that mean?

It means you’re not covered for any athletic injury that a member might sustain[1] even though you are running a fitness facility.

Insurance is no one’s favorite subject, unless you’ve got a strange and unusual passion for archaic forms, seemingly contradictory verbiage, and 80+ page long documents. As a gym owner, you should trust that your insurance agent and/or carrier is looking out or your best interest. Unfortunately, that is not always the case.

Insurance agents or brokerages are often interested in binding as many policies as possible rather than finding the most comprehensive option out there. Insurance carriers are looking at you simply as a risk; how much of a risk is it to cover you and how can they mitigate that by excluding a few things.

Here are some things you need to know to protect yourself and your business.

The Basics

Every single gym should have, at minimum, General Liability and Professional Liability.

• General Liability protects you from bodily injury and/or property suits filed by individuals who are not employed by your business (clients, vendors, etc.). This includes allegedly negligent operations, premises, products, completed operations, or advertising. The most common example of this is an accidental slip-and-fall on your premises.
  
  
• Professional Liability, arguably the most important coverage a fitness facility can purchase, extends coverage from wrongful acts that arise due to professional advice. This includes breach of duty, neglect, error, omission, misstatement or a misleading statement. A good example is if you and/or your coach was accused of poor advise or instruction during a programmed workout.

If you’d like a cost-effective option that will give your insurance a boost, consider a Participant Accident policy.

• For a client to request compensation from you due an athletic injury they sustained at your gym they would need to sue you. If you have Participant Accident coverage, they don’t have to. This line of insurance enables you to pay for your client’s medical bills voluntarily, typically with a $25,000 limit, per accident.[2] This way they can heal, get back in the gym and you’ve help them do it - enabling you to retain a client. As an added plus, this can help prevent rising insurance rates by mitigating Liability claims on your policy. 

The Nitty Gritty

As an insurance brokerage that specialize in the fitness industry, we often review existing policies or quotes presented by other agents for clients. Hidden amongst the many pages are important details about your coverage. We have outlined the most common offenders towards coverage for fitness facilities below.

1. Athletic Participant Exclusion: As we discussed previously, this addition to your policy specifically excludes coverage for any athletic related injury at your gym. As a fitness facility, this is a huge gap! If someone sues you due to a sprained ankle or broken arm, you’ll need to pay for that out of pocket.
   
   
2. Communicable Disease Exclusion: This denies coverage for any suit due to a communicable disease. While this may seem unlikely, it isn’t uncommon for someone to tear their hands during pull-ups and for another person to follow suit on the same bar. If everyone is working out at the same time, you won’t be able to clean the bar until post workout. By then, it may be too late.
   
   
3. Designated Premises Exclusion: This restricts coverage to the brick and mortar of your building. If you have an accident on an 800m run or take your members to the park for a workout, coverage won’t be extended to your incident. Since it didn’t happen within your premises, your insurance carrier isn’t obligated to cover it.
   
   
4. Underwriting exclusions for vertical apparatuses: Some carriers aren’t willing to extend coverage to vertical apparatuses and definitions vary by company. This may include pull-up bars, rigs, peg boards, rings, etc. If you find this restriction in your policy, we’d recommend checking in to see how your carrier defines a “vertical apparatus.”
   
   
5. Nutritional Counseling Exclusion: If you or your coaches provide any nutrition counseling, you may want to double check your policy. This endorsement excludes coverage for any nutritional counseling or advise that you give your clients. This may include the summer fit eating challenge that you create for your members.
   
   
6. Waiver & Release Condition: We all have our members sign waivers prior to any workout in our facility. We scan it, or we file it away and forget about it. Some carries will deny a claim if you are unable to produce the signed waiver for the injured party. So, if your computer is stolen or you lose your files amongst all the other things in the storage closet, you are on your own.
   
   
7. High liability deductibles: Some lower-budget carriers will include a liability deductible on a per accident basis. If you are looking to keep your costs low, this is potentially an option but not all carriers have the option to add or remove it. You may be stuck paying more out of pocket than you’d like to.
   
   
8. Age Restrictions: Some carriers will only provide coverage for members that are above a certain age. If you are training members below that age threshold, then coverage won’t be extended should an incident occur. It is very important to keep this in mind if you are thinking about adding a kids or teens class at your facility.

The Bottom Line

Read and understand before you sign! If you’ve already signed the dotted line, it is never too late to inform yourself about what your policy does and does not include. If insurance lingo is too much, (we don’t blame you!) ask your local insurance broker to review the policy exclusions with you. If you don’t know any, feel free to send us a copy at info@nexoins.com or call us at

Some language will be stapled across all Liability policies such as exclusions against lead, asbestos, employment-related practices, etc., but the potentially heavy-hitters (to your wallet) should be reviewed carefully. Even if they can’t be removed from the policy, at least you are aware and won’t be blind-sided.

It is important to educate yourself as much as possible to keep your members and your business safe and thriving!

[1] Specific verbiage: “With respect to any operations shown in the schedule, this insurance does not apply to “bodily injury” to any person while practicing for or participating in any sports or athletic contest or exhibition that you sponsor.”

[2] In excess of the client’s health care coverage.